Credit Scores

Credit Score Update

Another benefit of buying a new (used) vehicle is that I was able to get updated credit scores from Experian and Equifax thru a couple of the car dealers. Best of all, my scores were they highest they have ever been.

Experian: 784
Equifax: 756

My understanding is that your credit score for financing a car may be different than your credit score for, say, financing real estate because they are calculated slightly differently. Nevertheless, it’s nice to have current credit reports to review for any discrepancies. I found none and didn’t expect to since the credit scores were strong.

Credit Cards, Deals and Bargains

Cash Back Credit Card

As I have mentioned before, my Wife and I use our Citi Dividend Platinum Select credit card most of our monthly expenses. We receive 1%-2% cash rewards for these purchases and have been averaging a $50 cash back check every two months. It’s free money for bills we have to pay anyways. Plus, charging the expenses to a credit card helps with our monthly cash flow.

Citi Bank recently sent us a special referral offer. If you would like to sign up for a Dividend Platinum Select credit card, I can request that they email you a special offer that allows you to get 5% cash back for the first six months. That’s a great deal and an easy way to keep a little more of your money. After six months, the cash back reward reverts to the standard 1%-2% cash back.

If you’re interested, let me know and I’ll request the offer be emailed to you.

Full disclosure: Citi Bank provides me a $25 reward for each approved account (up to 5 accounts). So, we’re both benefiting.

Money Musings

Sold One Car, Bought Another

After 3+ months of trying, we were able to sell Car 1 over the weekend. We sold it to help reduce our monthly expenses and allow us to tow a ski boat my father-in-law is giving us. So, after the selling the car, we bought a used truck.

The 2001 truck only has 55,000 miles, 11,000 less than the 2002 car we sold. We will save $140/month on car payments and $15.66/month on auto insurance. This money will be deposited into our Emigrant Direct savings account each month. An added bonus is the truck gets the same gas mileage as the car we sold.

My wife did a great job of getting us an awesome interest rate at a local credit union. She was able to secure a 5.49% rate by taking advantage of a membership discount, direct deposit discount, and auto pay discount. We’re also getting a gas card because she was referred by a friend. To contrast that, other credit unions and the dealerships were quoting us 6.90% – 7.25%.

One change to our plans is that we will not be paying off our 0% interest credit card, but instead, use the money to repay $1,000 that we had to take out of savings for the car transactions. Of this money, $523.16 was used to pay off a balance on the car we sold (we sold it for a bit less than we owed), $30.00 was used to smog the car we sold, and the balance was used as a down payment on the car we purchased.

I love my new (used) truck, and we’re saving money at the same time. It doesn’t get any better than that.

Income Statement

May 2007 Income Statement

We’ve gone over budget each month, so I decided to revise our monthly budget to more accurately reflect our expenses. Our new monthly budget is $6,113.42, to help better account for household expenses, entertainment costs, and a little extra buffer for random expenses.

Nonetheless, we still went over budget, but by a smaller margin. Our total expenses for May were $6,251.88. Click on the spreadsheet below to see the breakdown.

Net Worth

May 2007 Net Worth Update (+$2,604.03)

Our net worth is now at $9,042.53, a $2,604.03 increase from last month (click on the spreadsheet below). Our biggest gain came from a $600 increase in our 401(k), only $100 of which was from contributions. We also checked off another short term goal by opening a Roth IRA for my wife and funding it with $3,000 (thus the hit to our savings amount). Our liabilities were reduced by their standard monthly amounts, except for our Chase credit card that we paid $105 extra on.

God willing, we should reach a net worth milestone of $10,000 next month.

Money Musings

The Value Of A Dollar

My parents did a great job of teaching me the value of a dollar.

I’ve never wanted for anything. I was blessed by them paying my way thru college (school, room, and board), paying for nice family vacations to Europe, and generally helping me when I was short on cash. But, at the same time, I started working at age 15-1/2, paid for half of my first car (they paid the other half), and have never been unemployed.

I remember at a young age my Dad explaining to me that, if I started saving early enough, I could have over $1,000,000 by the time I retire. I still have a 2001 Kiplinger Magazine article that he mail to me regarding making the most of your 401(k) early on.

My Mom is equally financially savvey. You should hear her negotiate a deal – no one drives a harder bargain. My Dad once calculated that my Mom saved our family roughly $600 a month just by shopping around for the best value, buying in bulk, cooking meals at home, etc.

I have friends who go on multiple expensive vacations each year, eat out for most meals, and buy the latest gadgets. I’m sure it’s fun now, but I wonder what planning, if any, they’re doing for the future.

I’m very lucky to have parents who taught me the balance between having fun and planning for the future. Thanks Mom and Dad!

Vacation

Memorial Day

My Wife and I just returned from spending some time with her dad and mother-in-law on the lake. Lots of sun, food, and fun.

It’s important to remember that today is a day of remembrance for those who have died in our nation’s service. Please take a moment to remember our fallen soldiers.

Credit Cards, Deals and Bargains

Cash Back Credit Cards

2 Comments

My wife and I pay most of our monthly bills using our Citi Dividend Platinum Select MasterCard cash back credit card. We pay for our groceries, gas, cable/internet, gifts, etc. using the card. We have also arranged to have my Wife’s medical insurance bill, my cell phone bill, and our Blockbuster Total Access bill automatically charged to the card each month. There are only a few things that we can’t charge to the cash back card such as our mortgages, HOA dues, and auto loans.

We have been averaging a $50 cash back reward every two months since we started paying our bills with the card 4 months ago. It’s important to note that there is a $300/year maximum to the cash back rewards. If we reach the maximum, we will then begin using our HSBC Platinum MasterCard cash back credit card. I am currently using the HSBC cash back card for my business trips, to help keep work expenses separate from our monthly bills. I average $25-$50 cash back every three months, just for charging business trips to the card.

It’s not a ton of money, but since we’re paying the bills anyways, we might as well get a percent or two of our money back. Besides, charging the bills to our cash back card helps with our month-to-month cash flow. And, of course, we always pay the credit card bill in full each month so that no interest is accrued.

If you’re not taking advantage of cash back credit cards, you may want to consider it.

Money Musings

Hard Math

I rarely eat fast food anymore, but got the urge to indulge in a value meal.

My bill total came to $7.42, for which I paid with a ten dollar bill and two pennies. I received a funny look for handing over the two pennies. I guess I shouldn’t have been surprised to received $2.56 as my change.

Go figure.

Money Musings

Just Got A Ticket

I was wondering what I should post about today and, after leaving the office, I got my answer.

Down the street from my office I noticed a number of police offices standing at a stop sign. I fastened my seatbelt before reaching them, but was still flagged to the side of the road by one of the officers. He said I was a little too late with the seatbelt and that I was receiving a seatbelt ticket.

I tried to get some sympathy, but the officer said they were out there on their day off giving out seatbelt tickets because of a government grant. He said they are taking a no tolerance position and that it had been announced on the news. I deserved the ticket so I wasn’t going to push it, however, while I was waiting for my ticket, another car was pulled over near me and the driver was irate. So much so that the officer writing my ticket was called over as back-up. After dealing with the upset driver, the officer came back to my car, gave me my ticket, and sent me on my way.

I checked online and it appears that the ticket will only cost me $20.00. Not too bad for a good reminder of the importance of buckling-up.

Our path to financial independence and retiring early.